ESG: Doing Business With Purpose

Companies traditionally measured their value based on accounting metrics —revenue, profits, and losses. But in 2015, the Paris Agreement — an international treaty aimed at mitigating the effects of climate change — put ESG standards at the forefront of business. Corporations began adding ESG metrics to the mix, considering criteria such as commitment to diversity, community engagement and philanthropy, and how an organization treats the environment.

But years before ESG became part of mainstream business vernacular, professors and students at the Gabelli School were already engaged in learning and practice that merge business with social good.

“From hosting the annual Sustainability Accounting Standards Board (SASB) symposiums a half a decade ago to offering the first academic course nationally that prepares students for the most prominent credential in this new field —Fundamentals of Sustainability Accounting (FSA) Credential — the Gabelli School has recognized ESG as the future of business education,” said Barbara Porco, PhD, clinical professor of accounting and associate dean of graduate studies. “Staying true to our mission of cura personalis, we have infused ESG risks and opportunities in existing and newly developed courses, and designed enrichment activities to provide every business student with a holistic education centered on environmental, social, and governance issues.”

Starting this year, Porco said, ESG literacy is part of the educational journey of every Gabelli School student. First-year undergraduate students are introduced to the basic concepts, including the Sustainable Development Goals (SDGs), and graduate students are invited to participate in the Responsible Business Leadership Certificate Program. Concentrations in social innovation and sustainable business are offered at both levels, as well as an MBA concentration in global sustainability.

Beyond academics, the Gabelli School collaborates with industry to address ESG-related issues. The Responsible Business Coalition (RBC), established at the Gabelli School in 2020, brings together scholars and business leaders in specific industries, such as fashion, in the name of solving complex issues — offsetting carbon, producing clean water, addressing waste and pollution, and ensuring that companies don’t discriminate against marginalized groups.

Today, the Gabelli School is just one of 38 chosen by the United Nations as a global champion and model of responsible business education (PRME), and one of 45 schools designated as a “Changemaker Campus” by AshokaU, a group that sets the international standard for social innovation education. And, all around the world, Gabelli School alumni are living out their alma mater’s Jesuit mission—to do business with purpose.

“That talk was transformative,” she said. “It lit up a light bulb in my head and immediately changed what I thought I was going to do with my career and what I wanted to do at Fordham. I became obsessed with social impact and what we now call ESG.”

Inspired, Catalana worked with her classmates, professors, and administrators to form the Social Innovation Collaboratory, a group that brings together students and faculty to apply entrepreneurial thinking to solve social-leaning global issues, such as poverty and disease. A decade later, the Collaboratory remains committed to social causes, with students and faculty involved in projects that directly impact Fordham’s Bronx and New York City communities.

Catalana found her niche in the fashion industry, starting her career on the corporate social responsibility team at Kenneth Cole Productions. Today, she serves as senior associate for social impact and Foundation programs at Tapestry, the parent company of brands like Coach and Kate Spade. She contributes to Tapestry’s greater ESG ambitions, building nonprofit partnerships and social impact programs that invest in social and environmental programs focused on access, opportunity, and local communities where Tapestry does business. Some examples include supporting employee-nominated organizations and providing disaster relief, like the company’s recent $100,000 donation to humanitarian and refugee efforts in Ukraine.

Catalana also teaches a Fordham class on Leadership in Service Learning, where she covers the fundamentals of service, leadership, and ESG issues.

“So many of my students are now minoring in sustainable business, doing work with the Collaboratory, and taking new ESG-related classes, like environmental economics and sustainable fashion,” Catalana said. “It’s a testament to the investments the Gabelli School makes in ESG programming. As an alumna, I’m thrilled to see it.”

Now, Fallo works as director of project development at Netgains Engineering P.C. One of his favorite parts of the job is when he gets to guide property owners and management groups toward energy efficiency and carbon-reduction strategies. Often, these groups feel skeptical that an investment in reducing their carbon footprints can actually save money. Fallo shows them that a redesigned HVAC system, for example, can not only reduce emissions, but cut costs. It’s not a purely ESG function, he said, but he sees his work as ESG in action — he helps companies focused on their financial returns see that social good can actually boost their bottom lines.

“We can bring in incentives from the state and the city to reduce their project capital expenditures by as much as 50% to 75%,” Fallo said. “ESG allowed me to look at the world in the ideological [and] in the financial — those two things can coexist very well together. That’s how I run my shop.”

For Jeannette Ferran Astorga, BS ’96, ESG means helping a company find and advance its purpose. She serves as executive vice president of corporate affairs, communications, and sustainability at Zoetis, the world’s largest producer of medicine and vaccinations for pets and livestock.

“I want to leave the world a better place,” Ferran Astorga said. “I always look for ways to find that sweet spot of adding business value, but also enabling a positive impact on stakeholders, including communities, our employees, our customers, and our shareholders.”

Ferran Astorga said that in one recent success, Zoetis partnered with the Bill and Melinda Gates Foundation to improve livestock health in Sub-Saharan Africa by growing access to veterinary care. The program also improved farmer access to diagnostic labs, animal medicine, and animal health training — more than 26,000 people (30% of whom were women) across the region were trained in how to better treat animals with health issues. In the five years since Zoetis started this project, Ferran Astorga said that the program has kept animals healthy and raised the standard of animal care for veterinarians and livestock farmers. As a result of the social impact the initiative is making, Zoetis was recently named to Fortune’s Change the World list for 2022.

“I have the role I’ve always dreamed of,” said Ferran Astorga, who studied marketing and finance as an undergraduate. “I’m able to integrate sustainability with corporate affairs and communication, and it’s amplifying our purpose throughout everything we do.”

Ferran Astorga noted how ESG has become especially important to younger generations. Between mentoring students at Fordham, surveying employees, and recruiting candidates, she has seen that more and more, younger people care deeply about a company’s ESG efforts.

“The bottom line is they like companies that are reporting these ESG metrics and showing how they’re accountable to environmental, social, and governance commitments,” Ferran Astorga said. “We see how our candidates are attracted to that.”

Fallo believes that ESG has already changed the world and will continue to—after all, more people than ever are now aware of how and where they’re spending their money. As PwC reported in a 2021 study, consumers between the ages of 17 and 38 years old are twice as likely to consider a company’s work on ESG-related issues when spending money.

“I like that it has this life now,” Fallo said. “I’m able to talk to companies about capital and operating expenditure reductions while also doing something that is socially productive.”

At the end of the day, Porco said, the focus on environment and social practices is only as meaningful as the governance that backs it.

“The term ESG often assumes that each element has equal parts; however, environment and social practices and decisions are only possible with proper governance,” she said. “Ultimately, you cannot have the E or the S without the G. Good governance is the foundation to all sustainability management.”

Hal Conick is a freelance writer based in Chicago.